The Work and Pensions Secretary has confirmed that some young people will lose access to benefits they currently qualify for, ahead of a landmark review set to address the surge in youth unemployment.
Minister Pat McFadden declared a "complete reset" of the system was necessary to support 16 to 24-year-olds not in education, work or training, whose numbers surpassed one million earlier this year. With growing unease among some backbenchers over the scale of future support, he urged MPs to regard the changes as a "different proposition" to last year, when the Government scrapped planned welfare cuts following a backbench rebellion.
Review expected to propose sweeping reforms
This comes ahead of Alan Milburn's review of so-called Neets – under-25s not in employment, education or training – due on Tuesday, which is widely expected to call for sweeping reforms to reduce welfare dependency. Mr Milburn has indicated that some young people will receive reduced financial support under his proposals, which include moving them off certain health-related benefits onto a new "youth allowance" paid at the standard universal credit rate.
When pressed on whether he agreed that some claimants should lose their current welfare entitlements, the Cabinet minister told the BBC's Sunday With Laura Kuenssberg show: "There will be people in the future who will not get what they would get today."
"When people come up for reassessment, they go on to a new system but, as I say, people are reassessed today under the current system."
Benefits bill and cost of living
He refused to confirm whether the overall working-age benefits bill would drop by the next election, saying: "Look, I can't say that - we uprate benefits every year, and I think it's important to keep people up with the cost of living."
"These are some of the poorest people in the country, and the best way to get the benefits bill down is with the long-term reset that we are talking about."
Andy Burnham has described the politically contentious report as a "watershed" moment but fell short of pledging to accept its recommendations fully or offer a "blanket assurance." The Prime Minister also maintained that funding the reforms would not require "more money" but rather "spending differently" within Government when challenged on the substantial upfront investment they're anticipated to demand.
Labour's rationale for reform
Facing questions about whether the Government can secure support from its MPs over any adopted changes, Mr McFadden contended ministers must pursue reforms not "in spite of being Labour people", but "because we're Labour people".
"If you're 20 right now and you sign on to long-term sickness benefits, you've got more chance of marking your 30th birthday and still being on them than having a steady job in between," he stated. "And the reason we have to change that isn't in spite of being Labour people, it's because we are Labour people."
He told Sky News' Sunday Morning show: "It's a different proposition from last year, and I hope that Parliament views it in that light." "We need a complete reset of the system in terms of what it offers young people to get these numbers," he said.
Ten-year Neets plan and political reactions
Mr Milburn said it would take 10 years to reach a "reasonable level" of Neets, warning that pushing harder or faster would simply lead to "crude cuts" that result in young people cropping up elsewhere in Government spending. He said the investment would likely run into the "billions" over this period, adding: "But what you get back is you get welfare savings back, and then you get the so-called fiscal benefits of young people not being reliant on a benefit but being paid a wage."
The former Labour health secretary, who was brought in by Sir Keir Starmer's government to conduct the review after it was compelled to scale back its own welfare proposals following a backbench rebellion, also argued that young people deserve a "legal guarantee" of a pathway into employment. The proposal received backing from the Work and Pensions Secretary, who on Sunday said employment support required a "legislative underpinning" with people given "more certainty about what they're entitled to."
When asked whether this would give young people the right to take legal action if opportunities weren't available, Mr Milburn told the BBC: "We're going to avoid that elephant trap, believe me. But we are going to have a duty on Government to provide opportunities." "We're calling it the opportunity guarantee, so there should be a guarantee for a young person because at the moment the only guarantee they've got is to a very simple thing, to get a benefit."
Shadow work and pensions secretary Helen Whately suggested the establishment of a legal entitlement "might sound a nice thing to do" but "doesn't make sense". However, the Conservative frontbencher offered cautious support for other aspects of Mr Milburn's proposal, noting his emphasis on shifting away from "handing out cash for relatively mild conditions" and towards employment support was "the right direction of travel". "We think he should do it for all ages, not just under 25. You should not have a different system for a 24-year-old and a 26-year-old," she told Sky.
Reform UK's Danny Kruger likewise said he was "encouraged" by "the suggestion that we need to be much stricter about benefits for young people who should be supported into work or should be working". Yet he expressed doubt that Labour would embrace this approach, telling the same programme: "There'll be indications that they want to, but the fact is, as we saw with Keir Starmer's rather weak attempt to make a couple of billion pounds of savings from the welfare bill last year, the backbenchers won't take it."
The MP continued: "I expect Labour will end up taking the extra spending on support for young people, but they won't do the cuts. What we actually need to do is to take a much more robust approach."
